COUNCIL ACTION FORM

URBAN RENEWAL PLAN APPROVAL

On September 9th, City Council reviewed a specific report regarding strategies to address changes to Tax Increment Financing (TIF) within Urban Renewal Areas (URA) as a result of recent state legislative approval of SF 2472. City Council determined on the 9th that it desired to proceed with creation of new URAs along with amendments to existing URAs before January 1, 2027 when additional limitations on TIF go into effect. 

On October 13th, City Council reviewed ten draft URA Plans and directed staff to proceed with the process to approve the Plans consistent with the requirements of Chapter 403 of the Code of Iowa. City staff refined the draft plans in preparation for their final review approval with minor changes to right-of-way areas of URAs and proposed projects. However, there is no change in the overall amount of proposed TIF compared to the October 13th meeting. The changes are detailed below. The ten proposed Urban Renewal Areas and Plans are attached to this report.

Four steps must occur for approval of a Plan:

1. City Council directs staff to hold a consultation meeting with affected taxing entities,
    
2. Planning and Zoning Commission provide a determination to the City Council regarding a proposed URA Plan “as to its conformity with the general plan for the development of the municipality
   as a whole.” Ames Plan 2040 is the City’s general plan for this purpose,
   
   
3. City Council adopts a resolution of necessity for a Urban Renewal Area, and
    
4. City Council holds a public hearing, scheduled for November 10th, to adopt the URA Plans.
   
   

CONSULTATION:

City staff provided notice to Story County, Gilbert School District, Nevada School District, Ames Community School District of a consultation meeting held on October 23rd.  Two Story County Board of Supervisors attended and one member of the Nevada School Board.   City staff answered questions about details of the plans.   No written comments were received by the City. No formal written responses to comments are required as referenced within Iowa Code 403 before the scheduled public hearing. The requirement for consultation has been fulfilled.

PLANNING AND ZONING COMMISSION: 

The Commission reviewed all ten of the updated proposed Plans at their meeting on November 4th.  Staff presented an overview of the Plans and identified that each Plan includes references to conformity to the City's general plan. The Commission voted 5-0 to determine that each of the proposed 10 Plans is in conformance with the City's general Plan.  The requirement for a Planning and Zoning Commission determination has been completed.

RESOLUTION OF NECESSITY:

Before approving an Urban Renewal Plan, the City Council must first determine that an area is appropriate for urban renewal by adopting a Resolution of Necessity. An URA must be for economic development purposes, removal of slum and blight, or both. Additionally, the City Council must find that "The rehabilitation, conservation, redevelopment, development, or a combination thereof, of the area is necessary in the interest of the public health, safety, or welfare of the residents of the municipality."

Each of the proposed Plans includes a declaration of the type of Plan.  The Downtown Reinvestment District URA and the Campustown URA include findings for both economic development and for slum and blight.  The other eight Plans are for economic development purposes.  City Council is being asked on November 10th, to adopt a Resolution of Necessity individually by resolution for each URA in conformance with the requirements of Iowa Code Chapter 403. Once this has occurred on the 10th, City Council may then hold a public hearing for approval of the Plans.

URBAN RENEWAL PLANS:

On October 13th, City Council reviewed draft Urban Renewal Plans.  Each proposed Plan identifies the detailed boundary of the URA, the objectives of the Plan, intended activities, proposed projects (including either or both public improvements and financial assistance for private development), maximum amounts of indebtedness related to Tax Increment Financing (TIF), and a description of conformity to Plan 2040 and other City Plans. The addendum includes the summary of the Plans. 
 
It is critical to emphasize that no activity can be undertaken by the City under the authority of Urban Renewal (Iowa Code Chapter 403) unless it is included within the approved URA Plan.  Additionally, the mere listing of the project or activity does not commit the City to undertake the project or activity. Specifically, no funding to a developer or for a public improvement occurs because of the Plan approval.  A Plan can be amended after its adoption. 

The final URA Plans included with this report have been updated since October 13th. The following is summary of significant changes.  

The ISU Research Park URA right-of-way boundary description was modified in regards to the planned bridge replacement project along Lincoln Way and it now includes the City owned former well property on Lincoln Way adjacent to the bridge.  The public improvement project list was modified to expand upon the type of Airport improvements projects that may be undertake to include runway and taxi areas.  

The Barilla URA was modified to include more Lincoln Way right-of-way to include the already planned reconstruction of East Lincoln Way to the Skunk River.  The original Plan include East Lincoln Way improvements, but did not include the full extent of the reconstruction project. 

The East 13th Street URA boundary was expanded to include the JT Warehouse properties as directed by City Council on the 13th. 

The Campustown boundary was expanded to include the whole Lincoln Way right-of-way from Sheldon to Beach Avenue. Accordingly, the public improvement project list was modified to include the reconstruction of Lincoln Way.

The South Bell URA description of right-of-way was updated to reflect the description of the Plan related to public improvements of Freel Drive, SE 5th, Dayton and East Lincoln Way.

City Council is asked after adoption of the Resolutions of Necessity to hold a public hearing for the proposed URA Plans and to approve each URA Plan by resolution. 

1. Approve the proposed Urban Renewal Areas and Plans by:
   1. Adopt a Resolution approving each of the ten individual URA Plans.
      
      
2. Direct staff to make modifications to a proposed URA or URA Plan and then adopt a resolution of necessity and resolution approving the Plan as applicable.
   
   
3. Hold a public hearing and request additional information or modifications for any or all of the proposed URAs.

In response to the significant changes to local government finance of SF2472, City Council requested the preparation of Urban Renewal Plans to help fund needed public improvements within the community and to potential facilitate economic development within the 10 proposed areas.   With the adoption of the resolution of necessity and approval of the Plans, the City Council can move forward with the next steps of considering the establishment of new Tax Increment Financing Districts (TIF Districts).  Establishing TIF Districts before January 1, 2027 will benefit from 25% more value in TIF collection than Districts created after January 1st.  Staff believes the ten attached Plans are consistent with City Council's direction from October 13th and are in compliance with all requirements of the Iowa Code 403.

Therefore, it is the recommendation of the City Manager that the City Council adopt Alternative No. 1.